Employment of mobile workers: Labour law and tax plus social security issues

This article answers the following questions:

• Who are mobile workers?
• What is the difference between mobile work and business travel?
• What are the personal income tax implications of mobile work?

Mobile workers, or, in other words, "field" workers, are employees who perform their duties outside the employer's place of business or a different specified place. Work of this type is mostly performed by sales representatives, repairers and fitters, or drivers. Due to the unusual nature of work, calculating salaries of such employees requires the analysis of labour law as well as several crucial judicial decisions. We will look into the most important ones.

What does labour law say about mobile workers?

There are no specific provisions concerning mobile workers in the Polish Labour Code. Nonetheless, in accordance with the regulations on the obligatory elements of employment contracts, the employer must specify the employee's place (or places) of work in the employment contract. 

Bearing this in mind, how should we draft the text of an employment contract with a mobile worker if there is no fixed place of his or her work? Certain judicial decisions say that one way to specify the place of work of an employee who performs work which requires constant changes of his or her location is to indicate a certain geographical area (Judgment of the Court of Appeal in Poznań of 12 May 2021, file no. III AUa 715/19)¹ around which the employee will be obliged to move (Resolution of the Supreme Court of 19 November 2008, file no. II PZP 11/08)². 

Mobile work and business travel

In considering the nature of a mobile workers' work, it must be decided whether or not employees who travel to business partners, it being a characteristic feature of their work, are formally on a business trip. 

In accordance with the Polish Labour Code, business trips must have the following elements:

• employee performing the duties of the employment; 
• employee acting on the employer's instruction; and 
• employee staying outside the place of the employer's business (or outside the permanent workplace). 

In addition, judicial decisions view business travel as such when the journey is of an incidental, temporary, and short-term nature, and the duty to perform is unusual in comparison with other employee's tasks. 

Thus, trips which are part of the ordinary and regular duties of employees are not regarded as business travel. Performance of work in different towns or cities, if employees carry out their duties in those locations on a regular basis, does not constitute business travel either. 

Taking into account the above, it should be stated that mobile workers who carry out their standard "field" duties in their regular working hours are not on a business trip. Nevertheless, any situations which deviate from the norm should be considered on a case by case basis, taking into account binding judicial decisions.

Working time of mobile workers

The time spent on necessary travel is included in the working time of mobile workers performing their duties within a designated area. 

In accordance with the assessment of the Supreme Court (Judgment of the Supreme Court of 6 May 2014, file no. II PK 219/13; Judgment of the Supreme Court of 26 October 2022, file no. II PSKP 11/22)³, the employee remains at the employer's disposal during such time, and the performance of work (carrying out of the duties of the employment) consists in mobility itself without which it would not be possible to fulfil basic tasks. It is irrelevant in this regard whether the employee drives his own car or a company car or uses public means of transport. 

Can commuting be included in the working hours?

Employees without a fixed or usual place of work can include the time spent on travelling between their homes and the premises of the first and last customers in their working time. This is the assessment of the Court of Justice of the European Union (Judgment of 10 September 2015 issued in Case C-266/14). 

The Polish Supreme Court held a similar view (Judgment of 24 February 2021, file no. III PSKP 4/21) and acknowledged that mobile workers remain at the employer's disposal as soon as they get into the car which they use to commute to work. Therefore, the working time of such employees ends as soon as they return home.

Allowance paid to mobile workers and the impact on personal income tax and social security

The specific nature of mobile workers' work also has an impact on tax and social security issues.

In accordance with the Polish Personal Income Tax Act, daily allowance paid to employees who are on a business trip is free from tax up to the amount specified in separate provisions (Regulation of the Minister of Labour and Social Policy of 29 January 2013 on the payments due to the employees of state or local government budgetary units on account of business travel (OJ 2023.2190))⁴. Therefore, reimbursement of the costs of travelling, accommodation, or meals is not taxable. 

The regulations on social security are similarly formulated, stating that daily allowance and other payments due on account of business travel are not subject to social security contributions of employees (Regulation of the Minister of Labour and Social Policy of 18 December 1998 on the specific rules of determining the basis for payment of retirement and disability pension contributions (OJ 2023.728))⁵. 

It must be emphasised that the exemption from tax and social security contributions applies to employees who are on a business trip, and, as mentioned above, mobile workers are not regarded as being on a business trip. Thus, the daily allowance paid to mobile workers is not subject to the exemption from personal income tax and social security contributions. This rule is validated by binding judicial decisions.  

As you can see, it is significant from the practical point of view to determine the nature of mobile workers' work. For this reason, if you have any doubts or inquiries as to this topic, fell free to contact our experts. 

¹ Judgment of the Court of Appeal in Poznań of 12 May 2021, file no. III AUa 715/19.

² Resolution of the Supreme Court of 19 November 2008, file no. II PZP 11/08.

³ Judgment of the Supreme Court of 6 May 2014, file no. II PK 219/13; Judgment of the Supreme Court of 26 October 2022, file no. II PSKP 11/22. 

⁴ Regulation of the Minister of Labour and Social Policy of 29 January 2013 on the payments due to the employees of state or local government budgetary units on account of business travel (OJ 2023.2190).

⁵ Regulation of the Minister of Labour and Social Policy of 18 December 1998 on the specific rules of determining the basis for payment of retirement and disability pension contributions (OJ 2023.728).